New York, United States — 06 June 2013 – Indian state group Coal India Limited is considering handing back two coal blocks in Mozambique to the government because of the lack of logistics facilities to move the coal to the country’s ports for export.

So says a senior official, who asked not to be named. “I don’t know when the required infrastructure to transport the coal will be built,” the source told the Wall Street Journal.

Coal India Limited was awarded two blocks in Tete province as part of an agreement between the governments of the two countries, but they have been left almost entirely undeveloped due to problems with public tenders to hire a third party to mine the coal, as well as a lack of progress in building roads, railways and ports in Mozambique.

The source, contacted by the newspaper, said that Coal India would announce its final decision on these two blocks in 2014, after carrying out as detailed an analysis as possible of the quantity and quality of coal in the blocks.

According to figures recently published by the Mozambican government the two blocks contain around 1Mt of high quality coal.

Any decision to leave Mozambique, where the group’s only international project is located, would be a blow to Coal India’s plans to reduce dependence on foreign suppliers, as the company provides 80% of India’s coal needs.

Source: The Wall Street Journal. For more information, click here.